$300 Million Contract to Repair Transmission Lines in Puerto Rico Given to Small Montana Firm

By Nathan Davis on October 25, 2017

The decision by Puerto Rico Electric Power Authority (PREPA) to award a $300 million contract to a small, Montana-based company is raising eyebrows and drawing criticism, reported The Washington Post on Monday.

Whitefish Energy is a small firm based in northwest Montana. The company was founded two years ago and has won two contracts from the Department of Energy. The largest was for $1.3 million to repair less than 5 miles of transmission line in Arizona. ON September 20 when Hurricane Maria made landfall in Puerto Rico, Whitefish Energy had two full-time employees.

The initial contract is small in scope relative to the widespread destruction on the island but is 20 times larger in scale than the job in Arizona.

“Our initial scope of work was restringing 100 miles of transmission lines,” Whitefish Energy spokesman Chris Chiames said. “Once we are on the island and working with PREPA and other government officials, there certainly will be other tasks that we are given and we take on.”

Chiames also said that the company’s past work in rough, mountainous areas as well as ability to mobilize subcontractors made Whitefish well suited for the job. Whitefish has 300 subcontractors in Puerto Rico and expects to hire hundreds more.

Financial issues have plagued Puerto Rico and PREPA for years. The island has been in an economic depression that has lasted more than a decade. The economic situation and resulting debt crisis meant that PREPA did not have access to the resources needed to repair and maintain the power grid, which contributed to the island’s inability to withstand a direct hit from a category 4 hurricane.

The public utility filed for bankruptcy last July 2017 with $9 billion in debt. The founder of Whitefish said in an interview that PREPA’s recent bankruptcy did not cause his company to shy away from Puerto Rico.

While other power companies “are all afraid of the question of how are we going to get paid, Whitefish Energy was the company that actually made the lead of faith and was able to get over here,” CEO Andy Techmanski told Bloomberg News.

Chiames agreed with his boss.

“We took on the work under the full assumption that we would be paid for it,” he said. “As a disaster recovery plan is put in place, there is a pretty strong history of federal and local governments stepping up to make payment for the rebuilding.”

The Congress passed a $36.5 billion disaster relief bill on Tuesday which is currently awaiting President Donald Trump’s signature. The bill authorizes much-needed funding for relief efforts in the US states and territories affected by several category 4 and 5 hurricanes this summer.

The bill also provides $1.27 billion for disaster food assistance for Puerto Rico.